The difference between the three types of mitigation lies with the entity responsible for credit or mitigation generation coupled with financial risk and liability associated with mitigation performance. No matter the mitigation provider, each party is responsible for land acquisition, restoration design, permitting, short- and long-term maintenance and monitoring, financial assurances, and conservation encumbrances.
Mitigation banks are developed by third party mitigation providers that provides its own capital sources to fund and complete restoration in a watershed in advance of development. Purchase of credits from a mitigation bank give permittees a cost-effective and risk/liability free solution as mitigation bankers assume all risk of mitigation success.
In-lieu fee programs are established by a state or non-profit organization. In-lieu fee programs are issued advanced mitigation credits (prior to restoration) and these credit sales produce the revenue for ILFs to fund restoration projects after an impact has occurred.
Permittee responsible mitigation is mitigation that is completed at an on-site or off-site location within the same watershed as the impacts by an individual permittee. No credit is generated with this option. Instead, acceptable mitigation offsets and restoration is calculated during the permitting process and the permittee is responsible for mitigation success along with liability, risk, and financials associated with mitigation.